Futures flat on mixed economic data
US markets set to open unchanged as the Federal Reserve is to begin its 2-day policy meeting.
U.S. equity futures were little changed in early premarket trade following mixed global economic data. Mixed data out of Japan was followed by a flood of data out of Europe, which lifted expectations of further easing by the European Central Bank on Thursday.
The eurozone unemployment rate rose to 12.1% in March, in line with expectations and higher than February's reading of 12.0%. Spain already reported that its unemployment climbed to a record last week, while Germany reported overnight that its unemployment rate was flat at 6.9% in March. Italy's unemployment rate remained flat at 11.5% on expectations of a rise to 11.7%.
Eurozone's consumer prices as measured by CPI fell in April to a 1.3% annualized rate from 1.8% in March, well below the expected 1.8% rate, raising hopes that the ECB will cut rates as it has only a price stability mandate.
Deutsche Bank (DB) announced that it was going to issue up to $6.5 billion in new stock to fill a capital shortfall as it reported a 19% rise in first quarter earnings. Earlier this year, S&P had warned that the bank would face a downgrade without more capital. Shares rose 5.52% premarket on the news.
S&P 500 futures were marginally lower at 1,587.30.
The EUR/USD was lower at 1.3073.
Spanish 10-year government bond yields fell 2 basis points to 4.14%.
Italian 10-year government bond yields fell one basis point to 3.9%.
Gold futures rose 0.14% to $1,469.40 per ounce.
Asian shares were mixed overnight on a mixed bag of economic data out of Japan and Korea. The Japanese Nikkei Index fell 0.17% while the Shanghai Composite Index was closed and the Hang Seng Index rose 0.69%. Also, the Korean Kospi rose 1.2% and Australian shares rose 1.28% to the highest level since June of 2008.
European shares were mostly modestly higher save for Italy and Germany that saw larger gains. The Spanish Ibex Index rose 0.05% and the Italian FTSE MIB Index rose 2.2% as Prime Minister Letta successfully formed a government. Meanwhile, the German DAX rose 0.84% while the French CAC 40 fell 0.01% and U.K. shares rose 0.1%.
Commodities were slightly weaker overnight led lower by energy futures. WTI crude futures declined 0.1% to $94.41 per barrel and Brent crude futures fell 0.15% to $103.65 per barrel. Copper futures fell 0.09% to $322.35 per pound. Gold was higher and silver futures rose 0.47% to $24.28 per ounce.
Currency markets were rather quiet overnight as the euro weakened slightly and the yen gained. The EUR/USD was lower at 1.3073 and the dollar fell against the yen to 97.55. Overall, the Dollar Index rose 0.03% on strength against the euro and the Swiss franc despite weakness against the yen, the Canadian dollar, and the pound.
Earnings reported Monday
Key companies that reported earnings Monday include:
Buffalo Wild Wings (BWLD) reported first quarter earnings per share of $0.87 vs. $0.99 on revenue of $304.4 million vs. $303.71 million.
Herbalife (HLF) reported first quarter earnings per share of $1.27 vs. $1.07 on in-line revenue of $1.12 billion and raised guidance.
Express Scripts Holdings (ESRX) reported first quarter earnings per share of $0.99 on revenue of $26.06 billion vs. $25.54 billion.
Stocks moving in the premarket included:
Deutsche Bank (DB) shares rose 5.52% premarket despite the company announcing an additional $6.5 billion, or 16% of market cap, in new equity offerings on the heels of a strong first quarter earnings report.
Best Buy (BBY) shares rose 1.28% on news that the company is looking to sell 50% of its European operations for $775 million.
PulteGroup (PHM) shares declined 0.57% premarket ahead of the release of the S&P Case-Shiller home price index and following the stronger than expected pending home sales data Monday in a move that appeared to be profit taking.
BP (BP) shares rose 3.45% premarket as the company reported first quarter earnings per share and declared its quarterly dividend.
Notable companies expected to report earnings Tuesday include:
3D Systems (DDD) is expected to report first quarter earnings per share of $0.21 vs. $0.17 a year ago.
Domino's Pizza (DPZ) is expected to report first quarter earnings per share of $0.55 vs. $0.47 a year ago.
Marathon Petroleum Corp. (MPC) is expected to report first quarter earnings per share of $2.16 vs. $1.70 a year ago.
Tenet Healthcare (THC) is expected to report first quarter earnings per share of $0.30 vs. $0.52 a year ago.
TRW Holdings (TRW) is expected to report first quarter earnings per share of $1.43 vs. $1.62 a year ago.
Valero Energy (VLO) is expected to report first quarter earnings per share of $0.98 vs. $0.31 a year ago.
Vertex Pharmaceuticals (VRTX) is expected to report a first quarter loss of $0.19 per share vs. earnings per share of $0.43 a year ago.
On the economics calendar Monday, the Federal Open Market Committee begins its two day policy meeting Tuesday. Data releases include the employment cost index, the Redbook, the S&P Case-Shiller home price index, the Chicago PMI, and consumer confidence. Also, the Treasury is set to auction four-week and 52-week bills. Overnight, Chinese and British manufacturing PMIs will be in focus.
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